Whether you’re keen to reduce your mortgage repayments, pay your debt off sooner, or free up cash to fund a brand new kitchen, remortgaging can make a significant difference to your financial situation. If done right, it has the potential to save you thousands of pounds over the course of your mortgage deal or give you access to the money you need for a big purchase.
One question we’re often asked is whether it’s wise to remortgage with the lender that provided you with your current mortgage deal. Let’s investigate…
What are the benefits of sticking with your existing lender?
Skip some of the fees
If you choose to remortgage with your existing lender, you may be able to skip some of the fees involved. For example, you may be able to avoid conveyancing and valuation costs if you stay put. With some lenders charging exit fees when a borrower moves to a different lender, this is another cost you might be able to avoid by staying with your current provider.
Save time
Some people choose to stick with their existing lender because they feel as though they can trust them and because they assume it will be less hassle. It is true that remortgaging with your current provider can save you time and reduce the amount of paperwork required, but it’s worth noting that you may still have to jump through certain affordability hoops in order to secure your new mortgage.
What are the benefits of switching to a new lender?
A greater choice of affordable deals
Automatically staying with your current mortgage provider could see you missing out on a number of better deals, some of which could save you a considerable amount more money than your current lender can. The mortgage products provided by your lender will only make up a small fraction of the overall market. In addition, your current lender may have deals that aren’t available to you because you’re not a new customer.
Generous mortgage benefits
Saving money or freeing up cash for large life purchases are just two benefits that can come from remortgaging. Some mortgage providers will have a multitude of other benefits on offer for customers, ranging from the ability to make overpayments to the option to take payment holidays if you’re in financial difficulties. Of course, your existing lender may offer some of these things, but comparing deals from a wider market will give you greater choice.
How do I find the right deal for me?
From using price comparison websites to approaching different lenders directly, there are a number of ways you can take your pick of a variety of mortgage products.
However, the most effective way of finding the best deal tends to involve using a mortgage broker. A mortgage broker will compare hundreds of mortgage deals from a wide selection of lenders, before highlighting the most affordable and suitable options for you.
A mortgage broker can be particularly helpful if you have any financial complications that could make it harder for you to get your application approved. For example, if you have a poor credit rating, small deposit or you’re self employed, some lenders may be reluctant to give you the ‘yes’ you need. A good mortgage broker will have an idea which lenders are most likely to approve your application, saving you the trouble of making numerous requests only to get rejected.
With rejected applications having the potential to impact your credit rating, it makes sense to try and get it right the first time you apply.
It’s no secret that remortgaging is a big financial move. It can make such a large impact to your financial situation that it’s not a decision to take lightly. By comparing a wide variety of deals from the entire market you can increase your chances of finding the right product for you.
To find out how TaylorMade can help you remortgage your property, please get in touch with our team.
